Govt earmarks P22-B for support PPP projects


Posted at Jul 27 2011 12:36 PM | Updated as of Jul 27 2011 11:13 PM

MANILA, Philippines - The government has earmarked P22.1 billion of next year's proposed P1.816-trillion national budget for investments in Public-Private Partnerships (PPPs), almost double the P12.5 billion allotted this year.

The Department of Budget and Management (DBM) said the amount would cover right-of-way purchases, land development and other facilities that would support the large infrastructure projects under the PPP program.

The support projects are meant to encourage the private sector to undertake PPPs that will be bid out out starting this year.

Data from DBM showed that bulk of the support fund will go to the Department of Transportation and Communications (DOTC), which will receive P8.6 billion.

The Department of Education will get P5 billion, while the Department of Public Works and Highways (DPWH) and the Department of Health will receive P3 billion each. The remaining P2.5 billion will go to the Department of Agriculture.

While the support fund is higher than last year's, it is smaller compared to the P49.6 billion the government had originally targeted.

The government was supposed to bid out 10 PPP projects this year, but it said it may only bid out five, as feasibility studies were taking longer than expected.

This month, the DPWH announced the start of the bidding process for the Daang Hari-South Luzon Expressway project, making it the first scheduled PPP project.

The contract to operate Metro Manila's two railways, LRT 1 and MRT 3, was originally the first but it was shelved after DOTC Secretary Jose de Jesus resigned. New DOTC Secretary Mar Roxas said he would study whether the railway operations need to be bid out at all.

The P1.6-billion Daang Hari-SLEx road is a four-kilometer road linking Bacoor, Cavite to SLEx. It is the second-smallest project in the government's PPP list.

Other PPP projects targeted for rollout this year include:

MRT-LRT extension (P70-B)
LRT 2 extension (P11.3-B)
NAIA Expressway (P10.6-B)
CALA Expressway (P10.5-B)
MRT-LRT1 contract (P7.7-B)
Bohol airport (P7.6-B)
Puerto Princesa airport (P4.4-B)
Legazpi airport (P3.2-B)
Laguindingan airport (P1.5-B)


Budget Secretary Florencio Abad earlier said the government was in a better position to provide sufficient fiscal space in the near-term for investments in PPP projects to flourish.

Abad said that success of PPPs could be ensured by providing fiscal space, which is the difference of projected obligations ceilings (after considering projected revenues and deficit targets) and forward estimates of the cost of ongoing programs.